MW Why crude prices won't fall back to levels seen before the Iran war anytime soon
By Claudia Assis
Trump says Americans should expect high gasoline prices 'for a little while.' These two companies point to a different scenario.
SLB and Halliburton said this week that they expect crude prices to remain higher for longer.
Two of the world's largest oilfield-services companies just said what pretty much no one in America wants to hear.
SLB $(SLB)$ on Friday and Halliburton $(HAL)$ earlier this week said they expect crude prices to remain higher for longer. That will have immediate implications for a host of crude-derived products and beyond, but none as scrutinized as gasoline.
President Donald Trump has said that Americans should expect high gasoline prices "for a little while." A gallon of gas shot past $4 on average in the U.S. following the start of the war with Iran, and that price is unlikely to come down as fast as consumers - and the Trump administration - hope.
Global energy markets are living through one of the worst-case scenarios - the closure, to varying degrees, of the Strait of Hormuz, through which about a fifth of the world's crude and crude products pass in times of peace. Attacks on pipelines and other energy infrastructure have also hobbled crude markets.
SLB, an $82 billion American behemoth that does business in more than 100 countries, said that it expects "postconflict liquid commodity prices to remain above preconflict levels." That reflects near-term supply disruptions caused by infrastructure damage, production halts and other impacts, and geopolitical risk premium, it said.
Countries are likely to respond by prioritizing supply diversification, investing in exploration and domestic resource development, and replenishing strategic reserves once the conflict subsides, SLB said.
Halliburton CEO Jeff Miller struck a similar tone on a call with analysts after the $33 billion company reported earnings on Tuesday.
"I believe the situation in the Middle East will have meaningful and long-lasting implications for the global energy sector," Miller said. Energy security is "no longer simply a talking point," he said, and the company expects to see "increased investment in localized oil and gas developments and urgency to diversify sources of oil and gas for those countries without their own resources."
A recovery for oil and gas production and inventories "will not be a quick or simple process," Miller said. "Big picture, this means the world is fundamentally tighter [on] oil and gas than it was 60 days ago."
SLB went on to say it anticipates more investments in short-cycle projects in North America and Latin America as well as long-cycle developments, particularly in deepwater offshore markets.
"Absent a prolonged conflict leading to an economic slowdown and demand destruction, these supply responses reinforce our conviction of a broad-based recovery in upstream markets in 2027 and 2028," it added.
Halliburton's Miller largely said the same, highlighting a "far more constructive backdrop" for upstream investments and the oilfield-services business. Halliburton "will thrive in this market," he said.
The stocks of both companies have gained more than 40% so far this year, compared with gains of about 4% for the S&P 500 index. SPX This week, Halliburton has gained nearly 7% and SLB nearly 5%.
-Claudia Assis
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(END) Dow Jones Newswires
April 24, 2026 15:07 ET (19:07 GMT)
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